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The United Kingdom's economy is very integrated with that of the European Union, particularly in agriculture, and disentangling the UK economy may lead to significant changes in legal regimes and trade patterns.

ERS plays a leading role in Federal research on food security and food security measurement in U.S. households and communities and provides data access and technical support to social science scholars to facilitate their research.

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The 2014-15 U.S. outbreak of Highly-Pathogenic Avian Influenza (HPAI) resulted in the loss of more than 50 million birds. The market impacts reflect not only lower production, but also the loss of overseas markets for broiler meat.

The rural population is shrinking due to outmigration of young adults, fewer births, increased mortality among working-age adults, and an aging population. Rural job growth since 2011 has been well below the urban growth rate.

ERS analyzed the impact of a USDA regulatory initiative that identified commercial chicken slaughter establishments with poor or mediocre ratings on Salmonella tests – specifically, how this has affected the outcome of subsequent tests.

U.S. manufacturing employment has been declining since the 1950s. A better understanding of the factors affecting the survival of rural manufacturing plants may help develop strategies to retain these jobs.

Sub-Saharan Africa (SSA) has undergone economic, social, and demographic transformations over the past 10 to 15 years. Among the poorest regions in the world, it faces major political and economic challenges and low food security.

Wednesday, February 7, 2018

U.S. net farm income is forecast to decline $5.4 billion (8.3 percent) to $59.5 billion in 2018, while U.S. net cash farm income is forecast to decline $6.7 billion (6.8 percent) to $91.9 billion (adjusted for inflation). The forecast declines are the result of changes in cash receipts and production expenses. Additionally, Government payments are forecast to decline $2.3 billion (20.0 percent) in inflation-adjusted terms; this is due largely to a forecast slight recovery in prices for many crops covered by the Price Loss Coverage program, combined with lower Agriculture Risk Coverage program revenue guarantees due to lower recent commodity prices for the crops covered under that program. If realized, 2018 net farm income would be the lowest since 2002 and net cash farm income would be at its lowest level since 2009. Both profitability measures remain below their 2000-16 averages, which included substantial increases in crop and animal/animal product cash receipts from 2010 to 2013. Net cash farm income includes cash receipts from farming as well as farm-related income, including government payments, minus cash expenses. Net farm income is a more comprehensive measure of profits that incorporates noncash items, including changes in inventories, economic depreciation, and gross imputed rental income. Find additional information and analysis on ERS’s Farm Sector Income and Finances topic page, released February 7, 2018.

Friday, January 26, 2018

Most farm households rely on off-farm income, such as wages from a job outside the farm. Typically, only commercial farm households receive a substantial share of their income from the farm. For example, in 2016, the median farm income was negative $2,008 for households operating residence farms (where the operator primarily works off-farm or is retired from farming), while median off-farm income was $83,400. Households operating intermediate farms (smaller farms where the operator’s occupation is farming) also earn the bulk of their income from off-farm sources. In contrast, households operating commercial farms—where gross cash income is $350,000 or more—derive most of their income from the farm (nearly $144,000 in 2016). Changes to their total household income follow profits from farming. Most agricultural production takes place on commercial farms. In 2016, residential and intermediate farms together accounted for over 90 percent of U.S. family farms and one-quarter of the value of production. By comparison, commercial farms accounted for 9 percent of family farms and three-quarters of production. This chart is based on data from the ERS data product Farm Household Income and Characteristics, updated November 2017.

Friday, December 1, 2017

USDA’s commodity, Federal crop insurance, and conservation programs provided about $16.9 billion in financial assistance to farm producers and landowners in 2015. Over time, as agricultural production shifted to larger farms, these programs’ payments shifted to higher-income households—which often operate larger farms. In 1991, half of commodity program payments went to farms operated by households with incomes over $60,717 (adjusted for inflation). By 2015, this midpoint value, at which half of payments went to households with higher incomes, was $146,126. Similar trends hold for other programs, though with variability across programs and over time. For example, the midpoint income level for crop insurance indemnity payments increased from 2010 to 2013, but by 2015 had dropped below the 2008 level, to $143,806. For context, the median U.S. household income shows little change over the period and in 2015 was $56,516. Payments from commodity programs reduce financial risks to specific commodity producers, while payments from federally subsidized crop insurance mitigate yield and revenue risks. Payments from conservation programs aim to conserve natural resources and reduce environmental impacts from farming. This chart appears in the ERS report The Evolving Distribution of Payments from Commodity, Conservation, and Federal Crop Insurance Programs, released November 2017.

Wednesday, November 29, 2017

After several years of decline, net farm income in 2017 for the U.S. farm sector as a whole is forecast to be relatively unchanged at $63.2 billion in inflation-adjusted terms (up about $0.5 billion, or 0.8 percent), while inflation-adjusted U.S. net cash farm income is forecast to rise almost $2.0 billion (2.1 percent) to $96.9 billion. Both profitability measures remain below their 2000-16 averages, which included substantial increases in crop and animal/animal product cash receipts from 2010 to 2013. Net cash farm income and net farm income are two conventional measures of farm sector profitability. Net cash farm income measures cash receipts from farming as well as cash farm-related income, including government payments, minus cash expenses. Net farm income is a more comprehensive measure that incorporates noncash items, including changes in inventories, economic depreciation, and gross imputed rental income. Find additional information and analysis on ERS’s Farm Sector Income and Finances topic page, released November 29, 2017.

Wednesday, October 11, 2017

Each August, as part of the its Farm Income data product, ERS produces estimates of the prior year’s cash receipts—the cash income the farm sector receives from agricultural commodity sales. This data product includes State-level estimates, which can help offer background information about States subject to unexpected changes that affect the agricultural sector, such as the recent hurricane that struck Texas. In 2016, U.S. cash receipts for all commodities totaled $352 billion. Texas contributed about 6 percent ($21 billion) of that total, behind only California and Iowa. Cattle and calves accounted for 40 percent ($8 billion) of cash receipts in Texas, compared to 13 percent nationwide. Only Nebraska had higher cash receipts for cattle and calves in 2016. Texas led the country in cash receipts from cotton at almost $3 billion (13 percent of the State’s receipts), accounting for 46 percent of the U.S. total for cotton. Milk and broilers each accounted for 9 percent of cash receipts in Texas. The State ranked sixth in both milk and broiler cash receipts nationwide. This chart uses data from the ERS U.S. and State-Level Farm Income and Wealth Statistics data product, updated August 2017.

Wednesday, August 30, 2017

After several years of declines, inflation-adjusted U.S. net farm income is forecast to increase about $0.9 billion (1.5 percent) to $63.4 billion in 2017, while inflation-adjusted U.S. net cash farm income is forecast to rise almost $9.8 billion (10.8 percent) to $100.4 billion. The expected increases are led by rising production and prices in the animal and animal product sector compared to 2016, while crops are expected to be flat. The stronger forecast growth in net cash farm income, relative to net farm income, is largely due to an additional $9.7 billion in cash receipts from the sale of crop inventories. The net cash farm income measure counts those sales as part of current-year income, while the net farm income measure counts the value of those inventories as part of prior-year income (when the crops were produced). Despite the forecast increases over 2016 levels, both profitability measures remain below their 2000-16 averages, which included surging crop and animal/animal product cash receipts from 2010 to 2013. Net cash farm income and net farm income are two conventional measures of farm sector profitability. Net cash farm income measures cash receipts from farming as well as farm-related income including government payments, minus cash expenses. Net farm income is a more comprehensive measure that incorporates non-cash items, including changes in inventories, economic depreciation, and gross imputed rental income. Find additional information and analysis on ERS’s Farm Sector Income and Finances topic page, released August 30, 2017.

Friday, June 30, 2017

In recent years, farm real estate (including farmland and buildings) has accounted for about 80 percent of the value of U.S. farm assets—amounting to about $2.4 trillion in 2015. Strong farm earnings and historically low interest rates have supported the increase in farmland values since 2009. Since 2014, farm real estate values in many regions have leveled off; and, in 2016, the national average per-acre value declined slightly. This is partly a response to the recent declines in farm income, which may temper expectations of future farm earning potential. In addition, the 2016 USDA 10-year commodity outlooks suggest that the prices of major commodities will all stabilize at, or grow modestly from, their current price levels—which are significantly lower than those in 2011. Expectations of interest rate increases, which have been noted in some U.S. farm regions, also put downward pressure on land values. Given that farm real estate makes up such a significant portion of the balance sheet of U.S. farms, changes in its value can affect the financial well-being of individual farms and the farm sector. Over 60 percent of U.S. farmland was owner-operated in 2014; for these owners, increases in real estate values make it easier to obtain credit and service debt. For the farmers who rent the remaining 39 percent of farmland, higher real estate values can lead to higher rent expenses. This chart appears in the ERS topic page for Farmland Value, updated April 2017.

Tuesday, May 9, 2017

Ongoing innovations in agriculture have enabled a single farmer, or farm family, to manage more acres or more animals. Farmers who take advantage of these innovations to expand their operations can reduce costs and raise profits because they can spread their investments over more acres. In 2015, larger family farms displayed stronger financial performance, on average, than smaller farms. For example, 74 percent of very large family farms—those with gross farm cash income (GCFI) of $5 million or more—had estimated operating profit margins (OPM) of at least 10 percent. This represents the safer yellow and green zones, with lower financial risk. By comparison, 54 percent of midsize family farms (GCFI of $350,000 to $999,999) also had an OPM of at least 10 percent. Most small farms (GCFI under $350,000) in the red zone (OPM under 10 percent), had a negative OPM, the result of losses from farming. Small farms account for 90 percent of U.S. farms, but only contribute about a quarter of the value of production. The majority of their operator households’ income comes from off-farm sources. This chart appears in the March 2017 Amber Waves data feature, "Large Family Farms Continue To Dominate U.S. Agricultural Production."

Tuesday, April 18, 2017

Nearly 90 percent of family farms are structured as sole proprietorships. These entities are not subject to pay income tax themselves; rather, the owners of the entities (farmers) are taxed individually on their share of income. Numerous Federal income tax law provisions allow farmers to reduce their tax liabilities by reporting losses. From 1998 to 2008, for example, taxable losses from farming (the red area of the chart) rose from $16.7 billion to $24.6 billion. This was due, in part, to changes in the tax code beginning in 2001 that expanded the ability of farms to deduct capital costs—such as tractors and machinery—in the year the equipment was purchased and used. Between 2007 and 2014, strong commodity prices bolstered farm-sector profits (the green area), but taxable net farm income (the blue line) remained negative. Farm sole proprietors, in aggregate, have reported negative net farm income since 1980; in other words, they’ve reported a farm loss due to higher farm expenses than income. In 2014, the latest year for which complete tax data are available, U.S. Internal Revenue Service data showed that nearly 67 percent of farm sole proprietors reported a farm loss. This chart appears in the ERS topic page for Federal Tax Policy Issues, updated January 2017.

Friday, March 24, 2017

In 2015, farm households had a median total income of $76,735 per household—a third greater than that of all U.S. households ($56,516). Median total household income increased with farm size, with the median income of households operating small family farms approximating the U.S. median household and those operating larger family farms far exceeding it. The source of household income also varied with farm size: As farm size decreased, off-farm income represented a larger share of total household income. Households operating midsize and large farms (gross cash farm income or GCFI greater than $350,000) earned the majority of their total household income from their farm operations. By comparison, more than half of households operating small farms (GCFI less than $350,000) incurred small losses from farming, so the majority of their total household income came from off-farm sources. Wages from off-farm jobs accounted for more than half of off-farm income across all farm households. Farm households also receive significant income from transfers (such as Social Security or private pensions), interest and dividends, and non-farm business income. This chart appears in the ERS data product Ag and Food Statistics: Charting the Essentials, updated March 2017.

Monday, February 27, 2017

Farm financial liquidity describes how easily the U.S. farm sector can convert assets to cash in order to meet its short-term debt obligations. One measure of liquidity is working capital, the difference between current assets (such as cash and inventory) and short-term debt. Higher working capital means better financial health for the farm sector. ERS expects that working capital for the farm sector could contract to $48 billion by the end of 2017. The erosion in working capital was caused both by the reduction in the value of current assets (down $87 billion since 2012) and growing current debt (up $30 billion since 2012). Although working capital has weakened since ERS started tracking this measure in 2012, this decline followed record highs in net cash farm income from 2011 to 2013. The balance sheet forecast also indicates that farm solvency ratios—which measure whether debt can be met in a timely manner—are favorable compared to 25-year historical averages. However, farm solvency has weakened for 5 consecutive years; taken together with the decline in working capital, this pattern reflects a modest increase in farm financial risk exposure for the sector as a whole. This chart is based on the ERS Farm Income and Wealth Statistics data product, updated February 7, 2017.

Wednesday, February 22, 2017

Commercial farm income is highly variable from year to year, fluctuating with output and prices. Income variability can affect key farm decisions, including how much to invest in farm assets (such as land or machinery) and how much to save as a cushion for low-earning years. Aggregate statistics, like the median income for all farms, can provide useful insight into how the farm sector as a whole fares from year to year—but can mask considerable variation for individual farms. For example, farms in one region might be thriving, whereas in another region they might be experiencing low incomes due to a localized drought. Between 2000 and 2014, median farm income for commercial farms ranged from about $70,000 to $180,000, with income fluctuating between consecutive years an average of $20,000. By comparison, a typical (representative) commercial farm with the same average income as the median commercial farm (about $120,000) could see its income fluctuate much more—with an average income swing of $86,000. This chart appears in the ERS report “Farm Household Income Volatility: An Analysis Using Panel Data From a National Survey,” released February 2017.

Tuesday, February 7, 2017

Net farm income is a conventional measure of farm sector profitability that is used as part of the U.S. Gross Domestic Product calculation. Following several years of record highs, net farm income trended downward from 2013 to 2016. For 2017, ERS forecasts net farm income will fall to $62.3 billion ($54.8 billion in inflation-adjusted terms). If realized, this would be an 8.7 percent decline from the prior year and a decline of 49.6 percent from the record high in 2013. The expected decline in 2017 net farm income is driven by a forecast reduction in the value of production. Crop value of production is forecast down $9.2 billion (4.9 percent), while the value of production of animal/animal products is forecast to decline by less than $1 billion (0.5 percent). Find additional information and analysis in ERS’ Farm Sector Income and Finances topic page, released February 7, 2017.

Wednesday, November 30, 2016

Net cash farm income and net farm income are two conventionally used and related measures of farm sector profitability. The first measure includes cash receipts, government payments, and other farm-related cash income net of cash expenses, while the second is more comprehensive and incorporates noncash transactions such as implicit rents, changes in inventories, and economic depreciation. Following several years of high income, both measures have trended downward since 2013. ERS forecasts that net cash farm and net farm income for 2016 will be $90.1 billion and $66.9 billion, respectively, or $80.9 billion and $60.1 billion, respectively, when adjusted for inflation (in 2009 dollars). Cash receipts declined across a broad set of agricultural commodities in 2015, and are expected to fall further in 2016—primarily for animal/animal products. Production expenses are forecast to contract in 2016, but not enough to offset the commodity price declines. Net cash farm and net farm income are below their 10-year averages, which include surging crop and animal/animal product cash receipts from 2010 to 2013. Find additional information and analysis in ERS’ Farm Sector Income and Finances topic page, updated November 30, 2016.

Wednesday, September 28, 2016

ERS forecasts net value added will decline by 6.1 percent and payments to stakeholders will increase by 0.9 percent ($0.5 billion) in 2016. Net value added represents the sum of economic returns to all stakeholders and equity owners. Stakeholders provide the hired labor, leased capital, and rental land used in agricultural production, but in most cases do not directly share risk in the short term. Stakeholders receive a fixed ¬payment in return for their services while equity owners share in the profits (net farm income). In general, the payments that stakeholders receive adjust more slowly over time than net returns to the equity owners of agricultural production. Find additional information and analysis in ERS’ Farm Sector Income and Finances topic page, released August 30, 2016.

Thursday, September 1, 2016

While the average leverage of farm businesses?as measured by debt-to-asset (D/A) ratios?has decreased over time, some farms remain highly leveraged. The D/A ratio that implies financial vulnerability varies with individual farm business characteristics, but a commonly used threshold to indicate high leverage is a D/A ratio greater than 0.4. Using this definition, highly-leveraged farms consistently accounted for a disproportionate but declining share of the total value of production by all farm businesses between 1992 and 2011. In 2011, 5.3 percent of farm businesses were highly leveraged and contributed 13.4 percent of farm businesses? total value of production; by comparison, in 1992, 9.5 percent of farm businesses, responsible for 19.6 percent of production, were highly leveraged. The declining role of highly-leveraged farms suggests the sector?s financial resiliency has increased over time because financial shocks?such as an unexpected drop in income or a sudden jump in interest rates?would likely affect fewer farm businesses, producing a smaller share of the value of production. This chart appears ?Farm Businesses Well-Positioned Financially, Despite Rising Debt? in the April 2014 Amber Waves online magazine.

Thursday, September 1, 2016

Worth $2.2 trillion, farm real estate (land and structures) accounted for 82 percent of the total value of U.S. farm assets in 2012. Because it comprises such a significant portion of the U.S. farm sector?s asset base, change in the value of farm real estate is a critical barometer of the farm sector's financial performance. Changes in farmland values also affect the financial well-being of agricultural producers, because farm real estate is the largest single component in a typical farmer's investment portfolio and it serves as the principal source of collateral for farm loans.?Following the 1980s farm crisis?during which farmland prices declined in response to rapidly rising interest rates and higher energy prices?farm real estate values have trended upward. Despite expectations of lower farm income this year, U.S. farm real estate values increased in 2014. This chart updates one found in the ERS report, Trends in U.S. Farmland Values and Ownership, EIB-92, February 2012.

Thursday, September 1, 2016

U.S. net cash farm income (NCFI)?the funds available to farm operators to meet family living expenses and pay down debt?is forecast to decline in 2015. This would be the second consecutive year of decline for NCFI, after reaching recent highs in 2012 and 2013. NCFI is expected to drop by $35.6 billion (28 percent) to $93 billion in 2015. If realized, the 2015 forecast would be the lowest since 2009, and $14.7 billion (in real terms) below the previous 10-year average. The drop in NCFI reflects a broad decline in commodity receipts. Crop receipts are expected to decrease by $18.2 billion from 2014, led by projected declines in receipts for corn ($8.6 billion) and soybeans ($5.7 billion).? Livestock receipts are expected to decline by $25.4 billion, with the largest decreases in receipts expected for dairy ($13.9 billion), hogs ($6.6 billion), and broilers ($4.4 billion). Partially offsetting reduced cash receipts, total cash expenses are forecast to decrease by $7.9 billion in 2015, the first decline since 2009. Government payments are also projected to rise 10 percent ($1.0 billion) to $10.8 billion in 2015. This chart is based on information found in the 2015 Farm Sector Income Forecast, released November 24, 2015.

Thursday, September 1, 2016

Net cash farm income (NCFI) and net farm income (NFI) are two common measures of farm sector profitability. NCFI includes cash receipts and farm program government payments less cash expenses; it represents the net cash income available to farmers in a given year. NFI is a broader measure that represents the net value added to the U.S. economy by the agricultural sector, and includes noncash transactions such as changes in inventories, capital replacement, and implicit rent and expenses related to the farm operators? dwelling. Following several years of high income, both measures have trended downward since 2013. ERS forecasts that, in 2016, net cash farm and net farm income will fall to $94.1 billion and $71.5 billion, respectively ($84.6 billion and $64.3 billion, when adjusted for inflation); these values are below their 10-year averages in both nominal and inflation-adjusted terms. Lower forecasts for NCFI and NFI reflect price declines across a broad set of agricultural commodities in 2015 that are expected to continue in 2016. A forecast increase in government payments and decline in production expenses in 2016 only partially offset the drop in commodity receipts. Find additional information and analysis on the 2016 farm sector income forecast in ERS? Farm Sector Income and Finances topic page, released August 30, 2016.

Thursday, September 1, 2016

The 2014 Farm Act revised the maximum income limitations (the income cap) that determine eligibility for most commodity and conservation programs and payments by replacing the separate limits on farm and nonfarm income specified in the 2008 Farm Act with a single total adjusted gross income cap of $900,000. Based on data for 2009-14--a period of overall increasing farm sector income--a comparison of the impact of the income caps imposed by the 2008 and 2014 Farm Acts finds that the number of potentially ineligible farms increases over the period under both income caps. The potential number of farms affected by the 2014 income cap is below the number affected by the 2008 income caps, averaging 1,500 farms per year (about 0.1 percent of all farms) for the period 2009-14. This chart is found in the August 2016 Amber Waves feature, ?Farm Bill Income Cap for Program Payment Eligibility Affects Few Farms.?